Measuring the efficiencies of Asia–Pacific international airports – Parametric and non-parametric evidence

The purpose of this paper is to estimate the efficiencies of, and to discuss the managerial implications for 12 international airports in the Asia–Pacific region based on data from the period 1998–2006. We applied data envelopment analysis (DEA) and stochastic frontier analysis (SFA) to compute efficiency estimates, and the empirical results are discussed in terms of management perspectives and mathematical analysis. From the management perspectives, we suggest that airports should focus more on investment than on human resources. In addition, we found that inefficiency effects associated with the production functions of airports increased over the investigated period. From the perspective of mathematical analysis, we determined that deviations from the efficient frontiers of production functions are largely attributed to technical inefficiency. Finally, the empirical results imply that employing the discretion to adjust the scale size of the production function appears to improve efficiency. The main contribution of the paper is in showing how DEA and SFA can be used together to complement each other.